Saudi Arabia’s New Regulatory Framework for Factories: An Overview

Saudi Arabia’s Ministry of Municipal Rural Affairs and Housing [MOMRAH] has introduced a comprehensive regulatory framework designed to significantly enhance the industrial investment environment for factories across the Kingdom. This new framework applies to factories located within urban areas, support service zones, and designated industrial districts, representing a key step in the country’s Vision 2030 economic diversification plan.

Scope of the New Framework

The new regulations aim to streamline industrial investment while ensuring all factories comply fully with urban planning, environmental safeguards, and safety standards. The framework underscores Saudi Arabia’s commitment to creating a safer, more organized, and investor-friendly industrial ecosystem by boosting transparency and operational excellence.

This regulatory framework covers all types of factories regardless of location, mandating licenses and permits that align with national standards for urban development and industrial safety.

Implementation Timeline and Practical Guidance for Businesses

The new factory regulations in Saudi Arabia are in effect from 2025, requiring businesses to promptly comply with licensing, spatial, structural, and environmental rules. Obtaining an industrial license from the Ministry of Industry and Mineral Resources (MIMR) is mandatory and may take 4 to 6 months, involving coordination with several government bodies. Timely compliance is essential to avoid penalties and disruptions, as Vision 2030 drives continuous improvements supporting safe and sustainable industrial growth. Expert guidance is recommended to navigate and expedite the regulatory process efficiently

This blog is a part of our Doing Business Legally in Saudi Arabia: A Complete Guide to the Commercial Companies Law blogpost.

Licensing and Compliance Requirements for Factories

To operate legally, factories must now obtain:

1. A valid commercial registration
2. An industrial license from the Ministry of Industry and Mineral Resources
3. An environmental permit from the National Centre for Environmental Compliance
4. Approval from Civil Defence confirming compliance with fire safety and building codes

These requirements serve to verify that factories adhere to strict regulations before commencing operations.

Structural Regulations under the framework

The framework enforces precise spatial mandates including:

1. Factory sites must be located in areas zoned for industrial or commercial use.
2. Each facility must occupy a plot between 300 square meters and 600 square metres[3].
3. Mandatory designated parking for trucks and vehicles, along with clearly marked loading and unloading zones to enhance logistics efficiency.
4. Engineering designs must include detailed plans for truck and pedestrian movement, entry and exit points, and security checkpoints.

Additionally, the Saudi Building Code has been reinforced, requiring:

1. Fire-resistant building materials
2. Proper ventilation and air conditioning systems
3. Fire alarm and firefighting systems
4. Accessibility features for people with disabilities
5. Facade designs that respect urban aesthetics per municipal guidelines

Operational Measures for Factories

Factories are required to implement strict operational measures, including:

1. Installation of surveillance cameras for enhanced security
2. Placement of internal signage to guide operations
3. Provision of electronic payment options if sales outlets exist
4. Prohibition of operation beyond licensed boundaries or after license expiration

Each licensed factory must display a unified QR code that links to its registration data, enabling easier verification by both authorities and the public.

Environmental Controls

The regulations emphasize:

1. Waste management protocols to handle industrial byproducts responsibly
2. Hygiene maintenance within factory premises
3. Separation of primary industrial activities from secondary ones to prevent overlaps and inefficiencies

Driving Vision 2030 Goals 

Saudi Arabia’s new factory regulations are closely linked to the country’s long-term economic plan, Saudi Vision 2030, and its National Industrial Strategy Program. These initiatives aim to strengthen local manufacturing, attract new investments, and reduce dependence on oil by creating a diverse and competitive economy. The updated framework supports these goals by ensuring factories operate safely, meet high standards, and contribute to sustainable industrial growth across the Kingdom. 

Made in Saudi Program 

Saudi Arabia’s “Made in Saudi” initiative, launched on March 28, 2021 under the patronage of HRH Crown Prince Mohammed bin Salman and spearheaded by the Ministry of Industry and Mineral Resources, is managed by the Saudi Export Development Authority (Saudi Exports) as part of the National Industrial Development and Logistics Program (NIDLP). 

This program empowers local manufacturers by granting them the right to use the official SAUDI MADE logo, helping businesses boost visibility, establish consumer trust, and reach international markets. Moreover, by nurturing a unified national brand, stimulating export growth, and fostering collaboration between public and private sectors, the initiative strongly supports the Kingdom’s broader goals under Vision 2030. Saudi Made 

Enforcement and Future Impact 

Municipal authorities will conduct regular inspections to ensure factories fully comply with the new regulations, imposing penalties on violations to uphold standards. These enforcement measures are designed to improve the quality of industrial operations, boost investor confidence, and align with Saudi Vision 2030 objectives. 

You will need expert assistance from a firm with a strong understanding of the market, as this article provides only a brief summary of the new regulations. For clear and detailed guidance, please contact our firm. 

This regulatory leap marks a vital step toward creating a safe, transparent, and globally competitive industrial ecosystem. Given the complexity of licensure, design, and compliance under such sweeping regulatory change, we recommend seeking tailored legal and operational support to navigate these requirements effectively.  

New regulatory framework: A step toward safer, transparent industrial sector 

Saudi Arabia’s new regulatory framework for factories represents a major advancement toward fostering a safer, more efficient, and transparent industrial sector. By setting high standards for licensing, construction, operation, and environmental responsibility, the Kingdom is reinforcing its position as a leading investment destination in the region while aligning with its ambitious Vision 2030 economic goals. This landmark move promises to create a well-organized industrial ecosystem that benefits businesses, communities, and the nation’s long-term growth.